Legislators see little support for increasing retiree contributions to health insurance

Doug Finke

Wednesday

Apr 28, 2010 at 12:01 AMApr 28, 2010 at 4:34 AM

Key Illinois lawmakers said Tuesday they sense little support for an increase in rates the state charges retirees for health insurance.

Key Illinois lawmakers said Tuesday they sense little support for an increase in rates the state charges retirees for health insurance.

The comments came as legislators and the Quinn administration got down to the task of trying to craft a budget plan for the year that starts July 1. The General Assembly has set May 7 as its target date for adjournment.

“We’re coming to that time when we have to put some rubber to the road,” said Sen. Donne Trotter, D-Chicago, the Senate Democrats’ top budget negotiator. “I think people are at the point (where) we need to quit pussyfooting.”

Higher fees for retiree health insurance has been one idea floated by the administration for helping to close the $13 billion budget gap. The increases would be particularly hard on people who retired at relatively young ages and do not qualify for Medicare.

“The proposed increases are indeed quite dramatic,” said Sen. Jeff Schoenberg, D-Evanston. “There is far from a clear consensus around the idea of requiring individual retirees to contribute to their health plan.”

In his budget plan, Quinn proposed capping the state subsidy for retiree health insurance at $300 per month, for an estimated savings of more than $250 million. According to the Commission on Government Forecasting and Accountability, the full monthly cost of insuring non-Medicare retirees ranges from $590 to $804 a month, depending on whether they are enrolled in managed care or a fee for service health plan.

The amount retirees pay for health coverage also depends on how long someone worked for the state. People with 20 or more years of service pay nothing for retiree insurance.

COGFA determined that, on average, the change would increase monthly premiums by $490 a month for those in traditional fee-for-service programs and nearly $278 a month for managed care participants.

“I had a sense there wasn’t much bipartisan support for the governor’s proposal,” said Rep. Raymond Poe, R-Springfield, a member of COGFA. COGFA discussed the proposal at a meeting last week.

“I think every member of COGFA that expressed an opinion on it was definitely opposed to a drastic increase for those retirees who are non-Medicare eligible,” said Rep. Richard Myers, R-Colchester, a co-chairman of COGFA.

Schoenberg, another COGFA co-chairman, advised Quinn against trying to impose the rate increase without General Assembly approval.

“The most prudent course of action would be for the General Assembly to act on this question one way or another, if for no other reason than to avert any legal challenge,” Schoenberg said.

The Quinn administration did not respond to a request for comment.

Doug Finke can be reached at 217-788-1527.

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